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Off-Topic Discussion => General Discussion => Topic started by: Mika on December 30, 2011, 09:01:51 am

Title: The Elop effect - 24 billion losses in 5 months
Post by: Mika on December 30, 2011, 09:01:51 am
I'm not sure how many of you have followed what's going on in Nokia, but here's one analysis (http://communities-dominate.blogs.com/brands/2011/12/calculating-the-elop-effect-hes-already-destroyed-a-company-the-size-of-oracle-and-profits-the-size-.html) that ends up with a conclusion that Nokia has lost about 24 billion dollars since the current CEO Elop made his statement that Symbian and Meego phones need to be out-phased. This effectively killed their demand in the markets and resulted in the company's still going on free fall in the stock market. The thing about this is that it is a new World Record in losses in such a short time! All this of course, assumes that the analysis in the above link is right, but for me it seems reasonable. This becomes scary in a way that Nokia is now predicted to become a text book case of how NOT to run your company.

Lumia phone itself doesn't seem to be very wanted. (http://communities-dominate.blogs.com/brands/2011/12/first-look-into-lumia-launch-and-preliminary-prospects-for-market-success.html) Nokia seems to have bet on the business side of the mobile phones so that the integration with Microsoft would provide excellent business phone for power users. However, as is pointed out, mobile phone markets are different from software markets in a way that the operators still have a lot of power to decide what phone they will run  - this is unlike in Finland, where there is relatively free competition between operators. Now, get this, Microsoft went and bought Skype, very much hated thing by the operators, which resulted in boycott of Windows Phones. It is very likely that Lumia will not be able to pull Nokia back due to this reason only.

What it comes to me, it is rather amazing to see the mobile phone manufacturers to start to offer things in mobile phones that Nokia had something like 10 years ago. I personally know, the company I work in did one thing that only now seems to appear in mobile phones - this trend was set by another company than Nokia! That's a staggering amount of technological lead lost - this is just unbelievable. Most of the people I know from Nokia were frustrated back in 2006, now most of them have already jumped from the company. All the engineering staff said the same: they had really cool stuff (touch screens were among those, a lot earlier than many of you think) back then, but they weren't allowed to put that on the phones due to middle management meddling since they saw it a risk for their position. I don't know, but for me this starts to sound a lot like the classic fall-up-the-ladder case.

What are your thoughts of this?
Title: Re: The Elop effect - 24 billion losses in 5 months
Post by: The E on December 30, 2011, 09:15:43 am
TLDR: Company that make consistently bad decisions, like clinging to a smartphone OS that is not Android even after it became apparent that Android was the thing everyone wanted, or cooperating with Microsoft before they got Windows 8 off the ground, or announcing the death of their current platform way before a replacement is available makes losses.

This is news? Or actually bad?
Title: Re: The Elop effect - 24 billion losses in 5 months
Post by: Mika on December 30, 2011, 09:25:04 am
Here is the Elop effect explained (http://communities-dominate.blogs.com/brands/2011/08/coining-term-elop-effect-when-you-combine-osborne-effect-and-ratner-effect.html)

What it comes to Android, I think the reason it is wanted is mainly cheap price.

The news is that Nokia will likely default in 2012, if they keep on going at the same direction. It was among the biggest companies and brands you could find still in the beginning of 2011. It is the rate at which all this is happening that is the news.

For Finns, the situation is sort of meh. Plenty of intellectual property of small companies was stolen by Nokia around 1999 and given freely to Asian companies that then drove Finnish companies out of business. Nokia was very important for Finland back then, but nowadays it isn't that much any more. They have constantly been threatening to get out of Finland, and that threat got old some years ago already.
Title: Re: The Elop effect - 24 billion losses in 5 months
Post by: The E on December 30, 2011, 09:37:48 am
Android's appeal isn't low price. Sure, there are android phones that are cheaper than iPhones, but there are also ones that are more expensive. The appeal is the large app store.
Title: Re: The Elop effect - 24 billion losses in 5 months
Post by: Mikes on December 30, 2011, 12:10:14 pm
Android's appeal isn't low price. Sure, there are android phones that are cheaper than iPhones, but there are also ones that are more expensive. The appeal is the large app store.

For me... it's simply the freedom to install any program I want. Such a basic feature...  I really don't get how people can be so accepting of Apples closed system and the arbitrary decisions and restrictions that come with it. (Those reports of Apple banning E-Mail and other apps for no other reason than the apps in question outperforming the "official" Apple app are frankly hilarious... ;) )
Title: Re: The Elop effect - 24 billion losses in 5 months
Post by: Bobboau on December 30, 2011, 12:58:17 pm
ok google, buy em! :D
Title: Re: The Elop effect - 24 billion losses in 5 months
Post by: stinkyFeet on December 30, 2011, 01:23:05 pm
A former guy in charge at Microsoft goes to a well established company, puts windows on all their products, and the company crashed. He even went out of his way to hinder Linux products that were performing great.

Personally, I think he saw android phones being made in china being better than what his company could make, and instead of people accepting this, they bet billions of dollars on what they thought could keep Nokia raking in big bucks. It was obviously a bad bet.

I think a problem that repeats itself is that when a large company is in a position where it won't be able to make the usual amount of money at what they've been doing, they start acting desperate. This means suing people, doing things at the cost of the well built up company image, and making risky bets. In this case the bad bet cost the people involved billions upon billions of dollars.
Title: Re: The Elop effect - 24 billion losses in 5 months
Post by: Herra Tohtori on December 30, 2011, 02:39:46 pm
I'll just leave this here.


(http://alltheragefaces.com/img/faces/large/angry-y-u-no-l.png)
Title: Re: The Elop effect - 24 billion losses in 5 months
Post by: Polpolion on December 30, 2011, 02:59:18 pm
As long as Qt doesn't vanish I will be happy. :nervous:
Title: Re: The Elop effect - 24 billion losses in 5 months
Post by: Mika on December 30, 2011, 03:45:34 pm
Well, all I can think of is that this will probably be the last nail in the coffin of Windows Phone. Nobody will ever touch it again if the analysis becomes true. Too bad it likely takes one major player out of the business while at it.

Qt belongs to the intellectual property of Nokia. Whoever buys Nokia gets the Qt as well. Most of the new owners would likely sack the CEO and the leading board of the company - except Microsoft - so you can guess what company will get it in the end. There is one more thing that could stop it though, namely a class action suit from the investors - as this can only be seen as a company takeover? Finnish court is unfortunately not very likely able to prosecute the case should the push come to shove.
Title: Re: The Elop effect - 24 billion losses in 5 months
Post by: Ghostavo on December 30, 2011, 07:21:06 pm
It seems people fail to see why Android got a big market share. Ironically, it has nothing to do with the consumers but with the operators/hardware manufacturers, who got an OS they can modify and cram with their stuff to differentiate themselves from the competition.
Title: Re: The Elop effect - 24 billion losses in 5 months
Post by: Mars on December 30, 2011, 08:45:36 pm
I see you've done studies.
Title: Re: The Elop effect - 24 billion losses in 5 months
Post by: NGTM-1R on December 31, 2011, 05:10:40 pm
My wife, who works for Qualcomm, is literally giggling.
Title: Re: The Elop effect - 24 billion losses in 5 months
Post by: Mika on January 01, 2012, 10:05:34 am
All this could be funny, were it not for the fact that along goes Nokia's intellectual property. At the moment, even Apple is paying royalties to Nokia for violating several of their patents. Can anyone imagine what happens when that intellectual property belongs to the hands of Microsoft?
Title: Re: The Elop effect - 24 billion losses in 5 months
Post by: pecenipicek on January 01, 2012, 11:11:24 am
All this could be funny, were it not for the fact that along goes Nokia's intellectual property. At the moment, even Apple is paying royalties to Nokia for violating several of their patents. Can anyone imagine what happens when that intellectual property belongs to the hands of Microsoft?
apple gets ****ed over the hardest? along with pretty much everyone else.
Title: Re: The Elop effect - 24 billion losses in 5 months
Post by: Aardwolf on January 01, 2012, 01:13:33 pm
Humbug. Another thing to hate about "intellectual property".
Title: Re: The Elop effect - 24 billion losses in 5 months
Post by: Nuke on January 01, 2012, 02:03:46 pm
i rather liked arm devices. of course i stopped liking them so much when the pda went and got replaced with the smart phone, and things started getting locked down, and you needed to pay someone on a monthly basis just to use it. compounded with the fact that i hate phones. kinda killed arm for me. id love to see a whole slew of cell phone companies go into the gutter and liberate what was once an awesome technology.
Title: Re: The Elop effect - 24 billion losses in 5 months
Post by: NGTM-1R on January 01, 2012, 06:04:02 pm
At the moment, even Apple is paying royalties to Nokia for violating several of their patents.

Then the patent question is refought on equal terms as opposed to the blatant favoritism EU courts showed the first time. Sounds good!
Title: Re: The Elop effect - 24 billion losses in 5 months
Post by: The E on January 02, 2012, 04:51:20 am
(http://pics.kuvaton.com/kuvei/kia2.jpg)
Title: Re: The Elop effect - 24 billion losses in 5 months
Post by: Mika on January 02, 2012, 04:35:46 pm
Gotta love the picture!

The interesting thing here is that the technology people reviewing it tend to like Lumia phones - and at least some of the early user experiences are positive. This doesn't still matter in the end, because the operators will decide whether they want to run the phone or not - not actually the end user - i.e. you and me. This applies to all phones, by the way. Operators do not dictate this much in Finland (more competition between them), so I expect to see some amount sales for the phone here. Elsewhere, eh, probably not much.

I can see the value of Office suite integration - heck, I'm finally starting to think maybe I should start reading emails from the phone while I'm on a business trip since I can only connect my laptop to trusted networks (trusted meaning very trusted in this case). It took about 8 years to develop this sort of need, but I'm still not sure whether I want any sort of micro computer or just a basic phone with text messaging. So far I have been using SMSs and phone calls rather successfully, the only place where I can see the need for internet connection or email is actually abroad. Central Europe, to be exact.
Title: Re: The Elop effect - 24 billion losses in 5 months
Post by: Fury on January 03, 2012, 03:21:58 am
Android might be popular but it does have a lot of problems of its own. One of the biggest problems that each manufacturer customizes their own version of Android for each phone which in turn causes long delays in releasing updates to the platform, some updates may never get released. While Android Market is the largest mobile phone app market currently, it is not practical for developers to develop and maintain a compatible version for each major version of Android. Sooner or later you will find that some apps for your phone are no longer available or updated.

Android gives a lot of freedom to manufacturers and operators, which is why those parties do favor Android. Apple on the other hand is extremely strict and there aren't myriad of different phones, so software and firmware updates aren't that much of a problem.

Windows Phone is probably going to hit the middle of Android and Apple in these. Microsoft is definitely stricter than Google but not as strict as Apple and doesn't manufacture its own phones like Apple does. Until Windows Phone 7.5, the platform really couldn't compete with Android and iOS either, but user feedback of 7.5 has been largely positive so that is a good sign. From the looks of it WinPhone market place is receiving a lot of WinPhone 7 compatible apps daily and I've checked that my most important Android apps do have WinPhone7 compatible versions or alternatives available.

Year 2012 will be very important to both Nokia and Microsoft, this is their chance to win people and companies over to WinPhone. This year we should also see whether Nokia's decision to partner with Microsoft pays off. Personally I am quite interested in getting a Nokia Lumia phone to replace my Android phone, which is only a year old now. But I am also tempted to wait for WinPhone 8 until I buy new phone.
Title: Re: The Elop effect - 24 billion losses in 5 months
Post by: Bobboau on January 03, 2012, 06:31:42 am
I can't wait until a cross platform development process is figured out, it will probably be in C.
Title: Re: The Elop effect - 24 billion losses in 5 months
Post by: Ghostavo on January 03, 2012, 04:52:17 pm
Actually, if such a thing ever gets off, it's going to be using some popular interpreted language.
Title: Re: The Elop effect - 24 billion losses in 5 months
Post by: Bobboau on January 03, 2012, 09:14:51 pm
oh, you've already got that, javascript.
Title: Re: The Elop effect - 24 billion losses in 5 months
Post by: BloodEagle on January 04, 2012, 01:57:44 am
Javascript can die in a fire.